OTT Services

​​All you need to know about the OTT Services.

What you need to know

Government of Uganda has introduced an OTT TAX effective 1st July 2018. The tax is an excise duty on over the top ("OTT") services and it is charged at rate of UGX 200 per user per day of access.

1)     What are OTT services?

OTT services to have been defined to mean "the transmission or receipt of voice or messages over the internet protocol network and includes access to virtual private networks"

 

2)     Which services are considered by the industry to be the OTT services that should be taxed?

It is the intention of government that any OTT sites similar to the examples listed hereunder are considered to be taxable:

·        WhatsApp·        Telegram·        Freevideo – Mail.Ru·        Tumblr
·        Facebook·        IM+·        TextMe·        Kik
·        Twitter·        IMessenger·        TalkU·        Chatouts
·        Truecaller·        Yahoo Messenger·        LOVOO·        Grindr
·        Google Hangouts·        Facetime·        Drupe·        LiveTalk
·        Google Alla·        Android Messages·        Imo​·        Zalo
·        Viber·        New Messenger·        Hangouts Dialer·        Kakao Talk
·        SnapChat·        TikTok·        CallerID·        Mood
·        LINE·        Instagram·        magicApp·        Google Plus
·        Phone+·        WiCall·        Skype·        LinkedIn
·        Call Free·        WeChat·        Badoo·        BBM-Free
·        Signal·        InMessage·        Hitwe·        Voxer Walkie Talkie
·        StealthChat·        TrueCaller·        SayHi·        Hike
·        Tinder·        Hi5·        iPair-Meet·        Moments
·        MeetMe·        Textra

3)     Is G-mail and other mail applications included as part of taxable OTT services?

No, Gmail and other mail services are currently not considered as taxable OTT services

 

4)     Are video streaming applications included as part of taxable OTT services?
No, video streaming, such as Ugandan television and iflix are currently not considered as taxable OTT services
 

5)     What are VPN's, and why are these subject to OTT TAX?​

VPN's are a common global method of accessing internet services while masking the nature of the internet service being used.  It is because such VPN's can then be used to access OTT services indirectly that government has included such sites as being subject to OTT TAX.  Unfortunately, the creation of a VPN service is relatively easy, and takes place outside of Ugandan borders.  For this reason, the operators will block access to VPN's that the authorities declare to be used for OTT services, unless the consumer has paid their OTT TAX

 

6)     Why do I have to pay the OTT TAX?

To be able to use the OTT services such as WhatApp you are required to pay an OTT TAX of UGX 200 per day.  If you don't pay the tax, you will not be able to use the listed OTT services even though you may have a valid data bundle.


7)     Why must I pay tax before a government collection order is issued?

We understand that a government collection order may be backdated to the first of July.  In the event, for example that the tax is cancelled or reduced, the tax will be reversed via mobile money, instead of passing it on to URA.

 

8)     How do I pay the Tax?

You can pay your OTT TAX by dialing *150*3# or *165*2# or through My MTN App. Payment will only be possible on Mobile money.

 

9)     How much do I pay?
The OTT TAX is UGX 200 per day of Access. You can however choose to pay for 1 day, 7 days or 30 days of access.

Please note that the OTT TAX will expire at Midnight (23:59) on a daily basis, unless the proper authorities direct that a day shall be defined as any 24-hour period.
 

10) Why can't I pay using the Airtime already loaded on my account?

Airtime has its own set of TAX (VAT and EXCISE) and in order to avoid unnecessary double taxation you are required to pay your OTT TAX only through mobile money

 

11) Why has the OTT TAX been introduced as a separate charge?

Charging the OTT excise duty separately from the data bundle enables the consumer to decide which days they would like to access the OTT services.

 

12) How long does my access last when I pay for one day?

When you pay the OTT TAX, you will be able to use OTT services up to Midnight. If you have a daily 24Hr data bundle that expires the following day, you be required to pay the OTT TAX for 2 days to be able to enjoy OTT services on the day of expiry of your bundle.

 

13) Do I have to pay the OTT TAX even if I have bought a bundle?
Yes, you will be required to pay the OTT TAX even when you have bought a bundle to be able to use the OTT services above. You can however use your bundle to access other non-OTT services without having to pay the OTT TAX
 

14) How can I pay the OTT TAX for my Dongle/Router, MiFi?

In order to pay for your OTT TAX for your dongle/MiFi you need to go onto Mobile Money *165#, *150*3# or MyMTN APP and select the option "pay for another", insert the number of the Modem or MIFI / Router and the OTT TAX will come to life


15) I browse internet using my Airtime.  Do I need to pay the OTT TAX?
Yes, the OTT TAX is not related to the way you consume the internet (bundle, pay as you go), as soon as you access OTT services you will need to pay the OTT TAX
 

16) Will I be charged the 1% Mobile Money tax on the OTT TAX transaction?

Yes, URA has advised that you will be charged 1% excise duty on the Mobile Money transaction to required to pay the OTT TAX.  Hence you will effectively pay UGX 202 in total per day.

 

17) Will there be a MTN fee on my Mobile Money Transaction to pay the OTT TAX?

No there is no additional MTN fee added to the payment of the OTT TAX

 

18) Will there be a MTN fee if I use my Mobile Money Transaction to pay the Africell OTT TAX?
To reduce inconvenience to all network customers during the implementation phase, there will be no MTN fee on Africell OTT at the date of launch.
 

19) Do I need to be registered with URA to pay the OTT TAX?

No, you do not need to be registered.

 

20) Will I be charged the OTT TAX if I use WiFi?
Access to the OTT services of all telecommunications service providers requires you to pay your OTT TAX for any of your devices or gadgets accessing OTT.

21) Will my friend or family sharing my MiFi connection (or device hotspot) be charged the OTT TAX?

No, the URA has advised that the user is your device or gadget that is accessing the OTT service.  Thus, allowing your friend or family to connect through your device is not important for tax purposes.

 

22) Will I be charged the OTT Tax if I use my computer at work (LAN connection)?

Your employer is responsible for the usage of any telecommunications services at the workplace and will have to pay OTT Tax for each of their links or disable OTT services at the workplace.

 

23) Would I have to pay the OTT Tax using a shared bundle with someone that has already paid the OTT TAX

All access to the OTT services through a device / gadget (using its own SIM card) requires you to pay your OTT TAX prior to usage

 

24) Can the OTT TAX be automatically deducted from my Mobile Money Account?

You have the option of purchasing a 1 day, 7 days or 30 days OTT TAX pass.

There is no auto-renewal for now.

 

25) Can I access OTT services while roaming out of the country?
You must pay OTT TAX in order enable your data roaming service.
 

26) I'm a postpaid customer what do I do?
As a postpaid customer you will be responsible to pay the OTT TAX to access OTT services
 

27) My Company buys data for me, what should I do?

You will be responsible to pay the OTT Tax to access OTT services

 

28) Can I claim the OTT TAX back?

No, it is an EXCISE DUTY, not VAT​.


Government of Uganda has introduced an OTT TAX effective 1st July 2018. The tax is an excise duty on over the top ("OTT") services and it is charged at rate of UGX 200 per user per day of access.

1)     What are OTT services?

OTT services to have been defined to mean "the transmission or receipt of voice or messages over the internet protocol network and includes access to virtual private networks"

 

2)     Which services are considered by the industry to be the OTT services that should be taxed?

It is the intention of government that any OTT sites similar to the examples listed hereunder are considered to be taxable:

·        WhatsApp·        Telegram·        Freevideo – Mail.Ru·        Tumblr
·        Facebook·        IM+·        TextMe·        Kik
·        Twitter·        IMessenger·        TalkU·        Chatouts
·        Truecaller·        Yahoo Messenger·        LOVOO·        Grindr
·        Google Hangouts·        Facetime·        Drupe·        LiveTalk
·        Google Alla·        Android Messages·        Imo​·        Zalo
·        Viber·        New Messenger·        Hangouts Dialer·        Kakao Talk
·        SnapChat·        TikTok·        CallerID·        Mood
·        LINE·        Instagram·        magicApp·        Google Plus
·        Phone+·        WiCall·        Skype·        LinkedIn
·        Call Free·        WeChat·        Badoo·        BBM-Free
·        Signal·        InMessage·        Hitwe·        Voxer Walkie Talkie
·        StealthChat·        TrueCaller·        SayHi·        Hike
·        Tinder·        Hi5·        iPair-Meet·        Moments
·        MeetMe·        Textra

3)     Is G-mail and other mail applications included as part of taxable OTT services?

No, Gmail and other mail services are currently not considered as taxable OTT services

 

4)     Are video streaming applications included as part of taxable OTT services?
No, video streaming, such as Ugandan television and iflix are currently not considered as taxable OTT services
 

5)     What are VPN's, and why are these subject to OTT TAX?​

VPN's are a common global method of accessing internet services while masking the nature of the internet service being used.  It is because such VPN's can then be used to access OTT services indirectly that government has included such sites as being subject to OTT TAX.  Unfortunately, the creation of a VPN service is relatively easy, and takes place outside of Ugandan borders.  For this reason, the operators will block access to VPN's that the authorities declare to be used for OTT services, unless the consumer has paid their OTT TAX

 

6)     Why do I have to pay the OTT TAX?

To be able to use the OTT services such as WhatApp you are required to pay an OTT TAX of UGX 200 per day.  If you don't pay the tax, you will not be able to use the listed OTT services even though you may have a valid data bundle.


7)     Why must I pay tax before a government collection order is issued?

We understand that a government collection order may be backdated to the first of July.  In the event, for example that the tax is cancelled or reduced, the tax will be reversed via mobile money, instead of passing it on to URA.

 

8)     How do I pay the Tax?

You can pay your OTT TAX by dialing *150*3# or *165*2# or through My MTN App. Payment will only be possible on Mobile money.

 

9)     How much do I pay?
The OTT TAX is UGX 200 per day of Access. You can however choose to pay for 1 day, 7 days or 30 days of access.

Please note that the OTT TAX will expire at Midnight (23:59) on a daily basis, unless the proper authorities direct that a day shall be defined as any 24-hour period.
 

10) Why can't I pay using the Airtime already loaded on my account?

Airtime has its own set of TAX (VAT and EXCISE) and in order to avoid unnecessary double taxation you are required to pay your OTT TAX only through mobile money

 

11) Why has the OTT TAX been introduced as a separate charge?

Charging the OTT excise duty separately from the data bundle enables the consumer to decide which days they would like to access the OTT services.

 

12) How long does my access last when I pay for one day?

When you pay the OTT TAX, you will be able to use OTT services up to Midnight. If you have a daily 24Hr data bundle that expires the following day, you be required to pay the OTT TAX for 2 days to be able to enjoy OTT services on the day of expiry of your bundle.

 

13) Do I have to pay the OTT TAX even if I have bought a bundle?
Yes, you will be required to pay the OTT TAX even when you have bought a bundle to be able to use the OTT services above. You can however use your bundle to access other non-OTT services without having to pay the OTT TAX
 

14) How can I pay the OTT TAX for my Dongle/Router, MiFi?

In order to pay for your OTT TAX for your dongle/MiFi you need to go onto Mobile Money *165#, *150*3# or MyMTN APP and select the option "pay for another", insert the number of the Modem or MIFI / Router and the OTT TAX will come to life


15) I browse internet using my Airtime.  Do I need to pay the OTT TAX?
Yes, the OTT TAX is not related to the way you consume the internet (bundle, pay as you go), as soon as you access OTT services you will need to pay the OTT TAX
 

16) Will I be charged the 1% Mobile Money tax on the OTT TAX transaction?

Yes, URA has advised that you will be charged 1% excise duty on the Mobile Money transaction to required to pay the OTT TAX.  Hence you will effectively pay UGX 202 in total per day.

 

17) Will there be a MTN fee on my Mobile Money Transaction to pay the OTT TAX?

No there is no additional MTN fee added to the payment of the OTT TAX

 

18) Will there be a MTN fee if I use my Mobile Money Transaction to pay the Africell OTT TAX?
To reduce inconvenience to all network customers during the implementation phase, there will be no MTN fee on Africell OTT at the date of launch.
 

19) Do I need to be registered with URA to pay the OTT TAX?

No, you do not need to be registered.

 

20) Will I be charged the OTT TAX if I use WiFi?
Access to the OTT services of all telecommunications service providers requires you to pay your OTT TAX for any of your devices or gadgets accessing OTT.

21) Will my friend or family sharing my MiFi connection (or device hotspot) be charged the OTT TAX?

No, the URA has advised that the user is your device or gadget that is accessing the OTT service.  Thus, allowing your friend or family to connect through your device is not important for tax purposes.

 

22) Will I be charged the OTT Tax if I use my computer at work (LAN connection)?

Your employer is responsible for the usage of any telecommunications services at the workplace and will have to pay OTT Tax for each of their links or disable OTT services at the workplace.

 

23) Would I have to pay the OTT Tax using a shared bundle with someone that has already paid the OTT TAX

All access to the OTT services through a device / gadget (using its own SIM card) requires you to pay your OTT TAX prior to usage

 

24) Can the OTT TAX be automatically deducted from my Mobile Money Account?

You have the option of purchasing a 1 day, 7 days or 30 days OTT TAX pass.

There is no auto-renewal for now.

 

25) Can I access OTT services while roaming out of the country?
You must pay OTT TAX in order enable your data roaming service.
 

26) I'm a postpaid customer what do I do?
As a postpaid customer you will be responsible to pay the OTT TAX to access OTT services
 

27) My Company buys data for me, what should I do?

You will be responsible to pay the OTT Tax to access OTT services

 

28) Can I claim the OTT TAX back?

No, it is an EXCISE DUTY, not VAT​.